Also must take into consideration there is cost cutting in Q2 that will improve the net margin
Li Auto's 2Q Likely Its Most Challenging Quarter, DB Says -- Market Talk
0258 GMT - Li Auto's 2Q will likely be its most challenging quarter in terms of gross margins, Deutsche Bank analyst Bin Wang writes in a note. The Chinese automaker's selling prices for its flagship L7, L8, L9 and Mega models are lower after it cut prices in April, which will pressure its margins, he adds. The company also has an unfavorable product mix as the share of its cheaper L6 SUVs rose. Also, the consumers who bought vehicles before the price cuts were compensated. Considering these factors, Li Auto's 2Q margin will likely to drop 1.5 percentage points on quarter to 19.1% while net profit will likely drop 83% on quarter to CNY102 million, the analyst says. DB maintains a buy rating on the stock with a target price of HK$133.00. Shares were last at HK$74.10.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
Like
Report
Login to post
No comments yet